Share loss investors' new gain

Kate Nash

The Advertiser

14 Jun 04

PASMINCO'S 60,000 shareholders keen to crystallise their loss this tax year will take heart from an ATO decision.

The ruling means shareholders in the former zinc giant and other failed companies can claim the losses this tax year, says Tony McLean, founder of deListed, a privately-run company graveyard website.

The site, at www.delisted.com.au, lists all companies that have been delisted from the Australian Stock Exchange, which has a link to the site from its delisted companies page.

Mr McLean says until the ATO decision, these shareholders could only claim losses once the company had moved past administration to a liquidators' declaration.

Mr McLean says the ATO decision will interest all shareholders of companies in administration. ``Companies can be in administration for years, or not ever go into liquidation, frustrating shareholders keen to crystallise their losses,'' he says.

Capital losses can be used to offset capital gains realised in the same financial year. While losses can be carried forward, their value is not indexed to inflation so the real value of the loss will diminish over time.

Mr McLean says deListed will pay 1c to buy parcels of worthless shares.

The transaction generates an off-market share transfer and the creation of a trust by declaration, to comply with the ATO ruling.

In most cases deListed's $76 fee for the service would be more than offset by the potential benefit to the tax-payer of crystallising the loss.